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Beware of Titanic efforts to avoid economic icebergs

It’s a curious fact but the top tier of the Labour hierarchy seems to have a close affinity for things nautical while Conservative leader David Cameron is more bicycle clips and urban windmills.

For example, chancellor Alistair Darling has a penchant for dinghy sailing in the shallows around Scotland’s coast while Prime Minister Gordon Brown’s puppeteer Lord Mandelson of Foy has a weakness for boats of a more substantial variety – usually owned by Russian oligarchs and preferably moored somewhere exotic and warm.

As for the puppet himself, all the evidence appears to validate the hypothesis that Brown modelled the UK economy on the good ship Titanic.

His theory was presumably that under his captaincy the ship could sail full steam ahead and set new records. He could be confident that the Tripartite Authorities were keeping watch on the bridge and in any case, the ship was unsinkable. As he declared many times, under his navigation Tory icebergs were a thing of the past.

It wasn’t his fault that the officers of the watch – Tiner, King and Darling – fell asleep on the job, or that the watertight compartments didn’t keep the ship afloat, or that despite a supposed special relationship the icebergs originated in the US sub-prime market, or that his crew has spent more than 18 months trying to fix the leak.

They have tried the Special Liquidity Scheme, they have nationalised some banks and they have been dropping the Bank of England base rate as if there was no tomorrow.

And until last month they also seemed to have overlooked the recommendations that resulted from Sir James Crosby’s review which might have kick-started the mortgage market that – as every landlubber knows – is the engine room of our economy.

True, Darling has announced some panic measures to try and address this but should Captain Brown and his crew stop the ship sinking – or even the Royal Bank of Scotland going under – the next big problem will be the remedial steps they will take to prevent such a disaster happening again.

Undoubtedly they will employ the usual experts, appoint a lending tsar, revise the Basle accord, strengthen regulation and create more quangos.

And to return to my naval analogy, an inquiry by the current government into the sinking of the Titanic would no doubt conclude that the watertight compartments were a mistake and the hull should have been built like a sieve – that way it could have let out water as fast as it let it in.

A little less of me

This leader is the last I’ll pen as editor of Lending Strategy, which it has been my pleasure to bring to life and run for three years. But all things must pass and from now on I’ll be taking more of a back seat as contributing editor, with my good friend Robyn Hall running the show.

But it’s not a case of goodbye. I’ll continue to rant once a month in this magazine and on a weekly basis in my Just JM column on our website, which can be accessed by signing up to our email alert.

There’ll be a lot of other stuff too but in between times I’ll be catching up with all the things I’ve put on hold for the past 20 years. Life is good and writing for you has been a privilege. Thank you.


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